Can Market Reforms Curb the Expansion of Industrial Land?—Based on the Panel Data Analysis of Five National-Level Urban Agglomerations

As China entered marketization in the late 1980s, it soon established a market economy system and implemented tax-sharing reforms. Driven by the marketization, local governments have rapidly developed the economy under the pressure of fiscal competition caused by the reform of the tax-sharing system. Industrial land is an important factor of local economic development, and it enables local governments to invest heavily in the industrial sector to promote economic development, leading to urban expansion. In order to shed light on the relationship between the market reforms implemented by the Chinese government and the expansion of urban industrial land, this paper used the data of 77 prefecture-level cities in China’s five national-level urban agglomerations as research samples from 2007 to 2018. We first constructed the marketization rate of industrial land (MIL) and used the panel data model to examine whether China′s market reform will curb the expansion of industrial land. The results showed that: (1) land market reform can restrain the scale of industrial land expansion, and the impact is different in different urban agglomerations; (2) under the effect of marketization, foreign direct investment (FDI) has restrained the expansion of industrial land to a certain extent. The amount of industrial investment (AII), the ratio of secondary industry to GDP structure (RSG), and the number of industrial enterprises (NIE) will aggravate the expansion of industrial land. We suggest that the Chinese government should deepen the reform of land marketization and develop a differentiated land market mechanism. It is also necessary for local governments to develop stock land, improve the efficiency of industrial land use, increase the investment in advanced technology, and improve the intensive utilization of industrial land. The research provides a reference for other countries in the world that are developing in a transitional period to restrain unlimited land expansion and save land resources in the process of economic development.

From the tax-sharing system to the program system: Institutional evolution and organizational mechanism

Soon after implementing reforms to the tax-sharing system, the People’s Republic of China (PRC) implemented public budgeting reform, and thus formed a new kind of state governance system, the program system (PS). There are three categories of program expenditures available to local governments: “earmarked grants” from higher-level authorities; “non-grant program funds” from higher-level authorities; and program funds from same-level government departments. The convergence and reorganization of these three categories of program expenditure at the local level has, to a great extent, molded the fiscal structure of grassroots government in the PRC. The PS in essence does not mean discarding or surpassing the bureaucratic state system, rather, it is the active improvement and supplementing of the bureaucratic system by the state: a continuation and development of state regime construction. The overt purpose of the PS is to “solidify” budgetary constraints, while the underlying purpose is to enhance the government’s ability to respond to society. The two purposes present some tension in practice, as the rationalized and professionalized forms of governance that result do not necessarily enhance the ability to respond to public needs; in fact the reverse is quite possible.

Why China’s Re-centralisation Emerges in the Age of Globalisation?

Although involved in the age of globalisation,1 China has become more centralised. After the decentralisation from 1978 to 1993, the trend of centralisation2 has been once again strengthened since 1994, which was called re-centralisation by some scholars. Many scholars only focus on the period since the 18th CPC National Congress in 2012, but they fail to find out the root cause for re-centralisation. They ignore the fact that the 1994 Tax-sharing System Reform is an important sign of China’s re-centralisation, the answer may lie in it. In this article, we analyse the 1994 Tax-Sharing System from the perspective of Weber’s theory of domination and find out that the anxiety of the new Chinese central government in the early 1990s was the motivation for both tax reform and re-centralisation. At that time, the new central government could rely on none of Weber’s types of legitimate authority to maintain efficient operations because the charismatic authority3 of central leaders had weakened since the era of Deng Xiaoping, and the new type of authority had not been established. In these circumstances, the central government was eager to reshape the authority to stabilise the centralised order, which was also the basic motivation for Tax-Sharing System Reform.

Udziały jednostek samorządu terytorialnego w podatkach państwowych

The aim of this paper is to explore the rationale for the reform of the shares of local government units (LGUs) in national income taxes in Poland as well as to evaluate the selected proposals for changes in this area. The paper begins by outlining the definition and the basic features of tax sharing in the context of fiscal federalism. The next section provides an overview of the tax shares operating in some OECD countries. The main part of the article focuses on the key principles of the tax sharing system in Poland. The author briefly examines the fiscal efficiency of this source of local revenue in different types of Polish LGUs and the most significant dysfunctions of Polish local tax shares. The final section investigates the most important proposals for the reform of tax sharing and discusses their advantages and disadvantages.

Are Central Government Rules Okay? Assessing the Hidden Costs of Centralised Discipline for Municipal Borrowing

In the EU, the specialty municipal banks have been the traditional funding source besides tax sharing and governmental transfers for Local Governments (LGs). With the decentralization process, LGs experienced different market-based options so that banks were no longer the only source of funding. However, with the onset of the Eurozone crisis, public sector debt is no more risk-free, and the cost of borrowing became unstable over time. To minimise such risks, Central Governments forced LGs to adopt general principles of control of local borrowing. Previous studies evidenced that centralised controls affect unitary countries more than federations. This paper investigates the Centralised Discipline and Control Model to understand whether it generates hidden costs. For such a purpose, the paper compares municipal bonds against borrowing from banks in Italy, a European unitary country. This paper highlights the existence of hidden costs for Italian LGs because the Central Government set up an expensive system for controlling the entire public sector debt. Policy makers should pay particular attention to which model of control to adopt by considering their country’s specific characteristics and the potential impacts of the different models on them, according to the present economic circumstances.

Transfer-based decentralisation, economic growth and spatial inequality: Evidence from China’s 2002–2003 tax sharing reform

China has adopted a transfer-based fiscal decentralisation scheme since the mid-1990s. In the 1994 tax sharing reform, the central government significantly raised its share of government revenue vis-à-vis local governments by taking most of the newly created value-added tax on manufacturing. One aim for the adoption of the transfer-based fiscal scheme was to channel more funds to less developed regions and rural areas, and to alleviate growing interregional inequality and urban–rural income disparity. In 2002 and 2003 the Chinese central government further grabbed 50% and 60%, respectively, of the income taxes previously assigned only to local governments while providing more fiscal transfers to the country’s poor regions and the countryside. Utilising the 2002–2003 change in China’s central–local tax sharing regime as an exogenous policy shock, we employ a Simulated Instrumental Variable approach to causally evaluate the effects of the policy shock on growth, interregional inequality and urban–rural disparity. We find the lower local tax share dis-incentivised local governments and led to lower growth. Although higher central transfers helped to reduce interregional inequalities in per capita GDP and per capita income, the equalising effects were only present for urban incomes. We argue that transfer-based decentralisation without bottom-up accountability was detrimental to economic growth and had limited impact on income redistribution.

Fiscal Degree Performance in Samarinda City: Budget Year of 2013-2017

The aim to be achieved in the study is to analyze and identify the degree of fiscal decentralization in the City of Samarinda during 2013-2017. This type of research is quantitative and the data source used is secondary data. The data is based on time series during budget year of 2013-2017, which was compiled through the publication of the Regional Revenue Agency and Central Bureau of Statistics Samarinda City. The analytical tool used is Degree of Fiscal Decentralization.Simple conclusions that can be obtained based on the analytical tool, namely: (1) The average ratio of Regional Original Income to Regional Revenues is 3.44% (very less); (2) The average ratio of Tax Sharing and Non Tax/Natural Resources Sharing to Regional Revenues is 39.69% (sufficient); (3) The average ratio of Balanced Budget to Regional Revenues is 64.51% (very good); (4) The average ratio of Regional Original Income to Regional Expenditures is 11.94% (less); (5) The average ratio of Regional Original Income to Capital Expenditures is 42.75% (good); and (6) The average ratio of Tax Sharing, Non Tax/Natural Resources Sharing, and Regional Original Income to Regional Expenditure is 47.20% (good).